PERSONAL INSURANCE
Life Insurance
About Life Insurance
Life is unpredictable. Protecting your loved ones in the event of your death with a life insurance policy will give them the financial support they’ll need.
Life insurance is designed to protect your family and other people who may depend on you financially. Your life insurance policy can help cover some or all of the financial loss at the time of your death depending on the policy you choose. Although most people with children immediately activate a life insurance policy, there are some instances where life insurance policies can be beneficial even if you have no dependents, such a decision cover your own funeral expenses.
Life insurance policies could be appropriate for :
- Families with dependants and/or real estate.
- Single, young adults- if you help support an elderly parent or other person financially.
- Working couples without children- you may find you would want life insurance in a case where one working spouse contributes more to the household income and that loss would create a financial burden.
If you realize you need a life insurance policy, now is the time to get it. Our BLG Insurance Specialists can help you determine what life insurance coverage you need.
Deciding you need a life insurance policy is can be easy. Determining what type of policy can be, too. There are three basic types of life insurance policies.
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Whole Life Insurance- Whole life insurance covers you for your entire life, not just for a specific period such as term insurance. In most cases, your monthly premium and death benefit will remain the same. Whole life insurance also builds cash value. This is a return on a portion of your premiums. It is possible for you to borrow against your whole life policy. Keep in mind, your cash value is tax-deferred until you choose to borrow against it. But as long as you don’t borrow against it, whole life insurance can also be a good choice because of the tax savings it allows.
There are a few choices to make when selecting whole life insurance. Your BLG Insurance Specialist can explain the most common choices including:
- Traditional Whole Life Insurance- allowing you a guaranteed minimum rate of return on your cash value portion
- Interest-Sensitive Whole Life Insurance- provides a variable interest rate on your cash value portion of your Whole Life Insurance policy. This type of policy has some flexibility such as increasing your death benefit without raising your premiums. This option depends on the current economy and the rate of return on your cash value portion.
- Single-premium Whole Life Insurance- is for someone who has a large sum of money and would like to purchase a policy up front. Like other whole life options, single-premium whole life accrues cash value and has the same tax shelter on returns.
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Universal Life Insurance- Universal life insurance provides a death benefit while including a tax-deferred interest accumulating savings account.
You may not have to pay premiums during the entire policy depending on costs accumulated in the tax-deferred savings portion of the policy, then premiums may eventually not be required..
This is a plan that specifically only works for people who feel they need life insurance into their later years. This allows the savings portion enough time to accumulate into an investment.
This type of must be in force for at least 15 years to be eligible for any return of the policy.
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Term Life Insurance- Term life insurance policy premiums are generally less expensive than cash-value policies. If you are young, in good health, are looking for low premiums and prefer a simple life insurance plan. When you buy a low cost term life insurance policy, it works within a specified time period, usually one, five, or ten years. During that "term" you pay a specified premium. Your beneficiaries only receive a death benefit if your death occurs during the term of this life insurance policy. When your term is over, you may choose to renew or convert to another life insurance policy such as a cash-value policy. In that case, your BLG Insurance Specialist will assist your in choosing the appropriate life insurance policy.
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Annual Review
At BLG, we strongly recommend you review your insurance coverage at least once a year. Your driving habits or living situations may have changed. Or, maybe you’ve made a few major purchases throughout the year that should have extra coverage. Inflation or depreciation can affect the value of your properties and their contents. Call BLG now to review, renew or establish your customized insurance policy that fits your world.
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